The finance world has been shaken up by the rise of decentralized finance (DeFi), but as the sector matures, we find ourselves standing at the threshold of a new era: DeFi 2.0. This blog aims to deep-dive into what DeFi 2.0 is, and how Multiple Protocol is leading the charge in defining this next chapter.
What is DeFi?
Before we delve into DeFi 2.0, let’s recap the basics of DeFi. Decentralized finance (or DeFi) is a blockchain-based form of finance that doesn’t rely on central financial intermediaries such as brokerages, exchanges, or banks to offer traditional financial instruments. In other words, DeFi protocols run on a blockchain and are governed by smart contracts.
The Emergence of DeFi 2.0
As the DeFi landscape has evolved, so too have its capabilities and shortcomings. DeFi 2.0 is a term coined to define the new wave of decentralized finance protocols that aim to address the issues of the first wave while offering enhanced features, such as concentrated liquidity, improved yield farming strategies, and more.
Concentrated Liquidity and Multiple Protocol
One of the cornerstone features of DeFi 2.0 is the concept of concentrated liquidity. Unlike traditional DeFi protocols where liquidity is spread across a wide range of prices, DeFi 2.0 platforms like Multiple Protocol allow liquidity providers (LPs) and general partners (GPs) to focus their liquidity within specific price ranges. This leads to higher capital efficiency and better yield.
Optimizing Yield for GPs and LPs
Multiple Protocol offers a seamless liquidity aggregator that enables GPs and LPs to gain better profitability through on-chain strategies. Our platform uses a unique dashboard for profit estimation, providing a transparent and efficient way to manage funds.
Proof of Profitability with NFT Work Permits
In the DeFi 2.0 landscape, trust and transparency are paramount. Multiple Protocol uses NFT Work Permits that offer proof of profitability. This allows GPs to access premium LP pools, and it enables LPs to choose the GP strategies that best suit their financial needs.
Ethereum Staking and Limit Orders
The resurgence in Ethereum’s Total Value Locked (TVL) is indicative of the rising demand for advanced financial activities like limit orders and ETH staking. DeFi 2.0 platforms, including Multiple Protocol, support these functionalities, making them a go-to solution for modern-day crypto investors.
DeFi 2.0 is more than just a buzzword; it’s a leap toward a more secure, transparent, and efficient financial future. Multiple Protocol is at the forefront of this shift, offering concentrated liquidity, advanced yield optimization strategies, and proof of profitability through NFT Work Permits. As we venture further into this new financial paradigm, it’s clear that DeFi 2.0 is not just the future — it’s the present.